January 4, 2013
Lady Bug Pest Control is a small eco-friendly franchise company that has generated a complaint from one of its few franchise owners.
Franchisee Lisa Alfaro claims she was sold a Lady Bug Pest Control franchise despite the fact that she did not qualify for the proper license.
She claims it was an “illegal set up” and now she feels like she is in a David vs. Goliath battle with her franchisor.
[ADMIN note: This post was originally published December 13, 2012. We invited Lady Bug President Lisa Miller to respond to Ms. Alfaro's complaints when this post was first published. We didn't receive a response.
On 1/3/13, a law firm representing Lady Bug Pest Control demanded that we take down this post as they claim it contains "false and defamatory" statements (they wouldn't say which ones). See their letter here: LADY BUG PEST CONTROL Franchise Warning
See our response here: LADY BUG PEST CONTROL Attacks UnhappyFranchisee.Com, Fails
We've added language to this post make it clear that Ms. Alfaro's claims are her own and not that of UnhappyFranchisee.com's. We've added language to make it painfully clear that OUR statements are just our opinions and are neither fact nor the result of divine revelation :)
We once again invited Ms. Miller to provide clarification, comment or rebuttal to our opinions or Ms. Alfaro's complaints]
Are you familiar with the Lady Bug Pest Control franchise? Please share your opinion below.
The first was the (in our opinion) crass, get-rich-quick feel of the franchise pitch.
[The pile of money "Franchises How Fortunes Are Made" graphic is from the Lady Bug Pest Control web page. The characterization of it as "crass" with a "get-rich-quick" feel is solely our subjective opinion]
The franchise page has a tacky (in our opinion) graphic with the words “Franchises How Fortunes are Made” superimposed over a pile of money.
The second warning sign was the (in our opinion) get-rich-quick approach of their area development structure and their (in our opinion) blatant “earnings claim”:
The minimum investment for an Area Representative is $100,000 for a territory for a population of 3,000,000, and another $100,000 available for working capital to grow your franchise system.
Within the Lady Bug System, an Area Representative Franchise Owner receives 50% of each franchise fee and 50% of the royalty income. As an example, which is for explanation purposes only, not a guarantee, the current franchise fee is $30,000 per unit and the royalty each unit owner pays up to 10% of their gross sales.
For each unit opened in the development territory, the Area Representative would receive $15,000 (50% of the $30,000 franchise fee). By selling 35 units in this territory, an Area Representative would receive 50% of these franchise fees, and then the Area Representative would also receive 50% of the royalties. Each unit generally starts off by paying a royalty of 10% of their gross sales which equals a 5% royalty to the Area Representative.
As franchisee’s increase their revenue, the Area Representative’s royalty stream can increase each year. Area Representative’s also operate their own unit, generating even more income annually. Within 5 -10 years, depending on the Area Representative’s own unit growth, and the success of their franchisees, the financial rewards could be very substantial.
So it struck us that (in our opinion) Lady Bug Pest Control may be looking for people who want to make a “fortune” in pest control by buying a territory for $100,000 then selling 35 franchises that will bring in $525,000 in franchise fees for them.
Unfortunately, (in our opinion) this kind of structure can be a disaster both for the Area Representatives, who are desperate to sell enough franchises to recoup their investments, and the franchisees, who feel they got the hard-sell and little-to-no support. We’re not saying this is the case specifically for Lady Bug Pest Control, just that we’ve seen it happen in the past. And it’s just our opinion, anyway, not a statement of fact.
Expressing her own personal opinion which is not necessarily shared by UnhappyFranchisee.Com, Lady Bug Pest Control franchisee Lisa Alfaro writes:
I am currently a franchise owner of Lady Bug Pest Control Specialists trying to get out of a bad franchise.
There are some very questionable business practices.
One is that the franchise was to provide insurance because I did not have the proper license.
I contacted the insurance company for Lady Bug and found out that if I had a claim they would not have covered me.
Research and get the proper kind of attorney. I got an attorney to review the contract and little did I know I should have had an attorney who knew pest control law. It was an illegal set up.
Right now I am David and Lady Bug is Goliath.
If you’re thinking of buying a Lady Bug franchise, maybe you’d be better off flying away home instead.
But that, of course, is just our opinion… not a statement of fact.
ARE YOU FAMILIAR WITH THE LADY BUG PEST CONTROL FRANCHISE OPPORTUNITY AND LISA MILLER? SHARE A COMMENT BELOW.
January 4, 2013
Lady Bug Pest Control is in the business of killing whatever creepy crawly thing its customers find offensive.
When a franchisee complaint against its company appeared on UnhappyFranchisee.Com, Lady Bug Pest Control assumed it could just blow the offending conversation – along with the 1st Amendment right to freedom of speech and freedom of the press – to kingdom come.
Lady Bug Pest Control deployed its high-powered law firm, Gordon & Rees, to use fear and intimidation to have a chilling effect on UnhappyFranchisee.Com, a site that has the gall to allow free and open discussion of franchise companies.
Gordon & Rees attorney Sean Carroll sent a blistering letter to UnhappyFranchisee.Com (Read it here: LADY BUG PEST CONTROL Franchise Warning) threatening to sue us for presumptive damages, attorney’s fees and costs, and punitive damages if we do not bend to their iron will by the end of the day today.
All we can say is: Thank God we live in America, a country that, despite it’s faults, upholds its citizens’ right to free speech and right to a free and independent press.
The United States affords bloggers and commenters unequaled protection from bullies who think that their ability to pay an attorney’s retainer gives them the right to scare and intimidate American citizens from sharing their opinions and beliefs.
Here is our response to Lady Bug President Lisa Miller and her hired gun, attorney Sean Carroll:
SEAN M. CARROLL
Gordon Rees, ATTORNEYS AT LAW
111 W. MONROE STREET, SUITE 1600
PHOENIX, AZ 85003
Sent via email to: SCARROLL@GORDONREES.COM, CC LadyBug@LadyBugCorp.com
I am in receipt of your letter dated December 28, 2012 (“Re: Lady Bug Pest Control”) that was transmitted via email January 3, 2013.
In your letter, you stated “On December 13, 2012, we were advised of a posting made by Ms. Lisa Alfaro regarding Lady Bug’s business on your website, Unhappyfranchisee.com. The postings are patently false and defamatory, including, without limitation, those that imply her business model is illegal and that her employees are not covered by insurance. Many of the defamatory comments are made from the poster, Lisa Alfaro. However, the editorial comments made by Unhappyfranchisee.com are equally false and defamatory, and give rise to liability on the part of Unhappyfranchisee.com.”
You further stated “If the posting regarding Lady Bug is not removed from your site by close of business, January 4, 2013, we will pursue legal action against Unhappyfranchisee.com and Lisa Alfaro to recoup these presumptive damages, in addition to all other damages sustained as a result of the defamatory postings. We will also seek an award of attorney’s fees and costs incurred in bringing this matter, as well as punitive damages.”
Upon receipt of your email, we immediately responded with a request that you clarify which of our statements, in particular, you believe are “false and defamatory,” so that we could look into your request. We did not receive a response from you.
After looking into this matter, we believe:
· UnhappyFranchisee.Com is not liable for comments made by Ms. Alfaro, as made clear by Section 230 of Title 47 of the United States Code (47 USC § 230).
· Since our statements are clearly labeled as opinion, not fact, they do not meet the legal definition of “defamation.”
· In light of the obvious absence of legal liability on our part, further legal threats or litigation by you and/or your client will clearly be attempts to bully, intimidate and coerce us into abandoning our rights protected by the 1st Amendment, which protects both Freedom of Speech and Freedom of the Press, as well as Anti-SLAPP legislation in California, Arizona and other states.
· It would be in your client’s best interest for her to take us up on our offer to publish a corporate clarification and/or rebuttal to our post, as we offered when it first appeared, rather than waging an inflammatory public campaign to suppress the expression of opinions regarding the Lady Bug Pest Control franchise opportunity.
UnhappyFranchisee.Com is not liable for the comments of others
We have been active business bloggers and web publishers on controversial franchise topics for the past 6 years. As such, we are no strangers to the laws pertaining to libel and freedom of speech on the Internet and, specifically, the legal protections afforded bloggers and web publishers. In order to save you further time, expense and potential embarrassment, let me introduce you to Section 230 of Title 47 of the United States Code (47 USC § 230).
In order for us to be liable for defamation, we would have to be the publisher or speaker of the offending information. Section 230 states that “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” This federal law preempts any state laws to the contrary: “[n]o cause of action may be brought and no liability may be imposed under any State or local law that is inconsistent with this section.” The courts have repeatedly rejected attempts to limit the reach of Section 230 to “traditional” Internet service providers, instead treating many diverse entities – including bloggers and blog publishers – as “interactive computer service providers.”
UnhappyFranchisee.Com, as an “interactive computer service provider,” is not legally liable for the comments made by Ms. Alfaro. We did not state that Mrs. Alfaro’s complaints about the Lady Bug Pest Control franchise are valid or true, just that she made them. In fact, we immediately offered Lady Bug President Lisa Miller the opportunity to address, rebut or refute these claims on our site, which she has, so far, declined to do.
Opinions, stated as opinions, are not legally defamatory
Mr. Carroll, I am sure you are aware that defamation is defined as “a false and unprivileged statement of fact that is harmful to someone’s reputation, and published ‘with fault,’ meaning as a result of negligence or malice.” [eff.org] Opinions, stated clearly as opinions, do not meet the legal definition of defamation. Out of respect for you and your client, we have added a disclaimer to the post making it doubly clear that our statements are clearly our opinions.
Additionally, we have no malice for your client, and immediately notified her of the complaint made against her company so that she could join the conversation and provide a rebuttal. In fact, our stated opinions were meant to help Lady Bug Pest Control by pointing out that the (in our opinion) cheesy reference to making a “fortune,” the garish “pile of money” graphics and the questionable earnings claim on her website may be attracting the wrong type of franchisee and/or setting the wrong expectation.
We offered our opinions in the form of constructive criticism, with no malicious intent.
Further threats against us will also backfire
We understand that your job is to represent the best interest of your client, so we don’t fault you for a single attempt to scare us into taking down a negative post. It was worth a try… and it failed. But it would not be in your client’s best interest to proceed with this same strategy moving forward.
In addition to the 1st Amendment, we are protected by anti-SLAPP legislation in your home state of CA, in Lady Bug’s home state of Arizona, and our home state.
According to Wikipedia: “A Strategic Lawsuit Against Public Participation (SLAPP) is a lawsuit that is intended to censor, intimidate, and silence critics by burdening them with the cost of a legal defense until they abandon their criticism or opposition.
“The typical SLAPP plaintiff does not normally expect to win the lawsuit. The plaintiff’s goals are accomplished if the defendant succumbs to fear, intimidation, mounting legal costs or simple exhaustion and abandons the criticism. A SLAPP may also intimidate others from participating in the debate. A SLAPP is often preceded by a legal threat.”
Would it really be in Lady Bug Pest Control’s best interest to turn a single complaint from a disgruntled franchisee into a fiery public debate as to whether Lady Bug and Lisa Miller are using fear and intimidation to suppress free speech?
Let’s turn lemons into lemonade… together!
Mr. Carroll, please share this good news/bad news message with your client, Ms. Miller.
It’s 2013, the age of social media. The bad news is that if someone talks smack about you online, you can’t just have your big brother go beat them up (even a big brother who bills at $400 or so an hour).
The good news is, you can join the conversation and defend yourself with a professional message and, hopefully, the facts. Heck, you can even turn that negative posting into a positive opportunity to build your company and your brand!
Rather than lawyering up and trying to scare the bejeebers out of us, we invite Ms. Miller to provide us with a glowing written account of her organization, her mission, her franchisee support programs, and all of the non-financial rewards that come with eradicating creepy crawly nasty things as a Lady Bug Pest Control franchise owner. We will post it with the same prominence as the original complaint.
Once it’s posted, Ms. Miller can invite all the happy Lady Bug Pest Control franchise owners, employees, and customers to post positive comments about what they love about LBPC, and how much they disagree with Ms. Alfaro’s criticism.
Best yet, we’ll post Ms. Miller’s statement and host the happy comments for FREE… no hourly rate, no retainer, nothing!
Yes, it’s 2013, a new year! The sun is shining! The Mayans were wrong, once again!
Together, we can help Ms. Miller turn lemons into lemonade and turn that frown upside down!
All she’s got to do is realize that since she can’t crush the conversation, she might as well join it.
God bless America!
tags: Lady Bug Pest Control, Lady Bug Pest Control franchise, Lady Bug Pest Control complaints, Lady Bug Pest Control franchise complaints, pest control franchise, Lisa Miller, Gordon Rees, Sean Carroll, Attorney Sean M. Carroll, franchise complaints, Takedown response, Section 230 protection
January 4, 2013
LADY BUG PEST CONTROL Franchise Warning: A single comment appeared on UnhappyFranchisee.Com from a disgruntled Lady Bug franchise owner.
As we like to encourage free and open discussion spanning both sides of each issue, we invited Lady Bug Pest Control President Lisa Miller to provide a response, rebuttal or clarification of the comment and our post.
On 12/13/12, we sent this email to LadyBug@LadyBugCorp.com
UnhappyFranchisee.Com is a franchise discussion site that tries to highlight both sides of franchise issues and complaints so that our readers, many of them prospective franchisees, can make up their own minds and make more informed decisions.
We have received a complaint from a Lady Bug franchisee which we have posted here:
We invite you and your company to provide further information, clarification and/or rebuttal. You may do so either in the comments section at the bottom of the post, or by providing a rebuttal statement to this email address for possible publication as a solo post. You are also encouraged to invite your other franchisees to leave comments on the post to provide a more balanced view of your franchise opportunity.
After visiting your website, we also shared our criticism of your franchise structure as well as your positioning your franchise as a path to making a fortune. We deal with franchise disputes every day on our site, and find that overpromising (make a fortune!) and Area Development structures such as yours frequently add to the likelihood of franchisee disputes.
As I said, though, we are a discussion site so we welcome and respect differing viewpoints from our own.
We thought it was a rather nice offer, but we never got a response from Ms. Miller.
Instead, on January 3, 2013 we received this nasty, threatening letter from Lady Bug Corp.’s high-powered law firm, Gordon & Rees:
SEAN M. CARROLL
ATTORNEYS AT LAW
111 W.MONROE STREET, SUITE 1600
PHOENIX, AZ 85003
December 28, 2012
VIA EMAIL ONLY
Re: Lady Bug Pest Control
This firm represents Lady Bug Pest Control (“Lady Bug”) with respect to the referenced matter. This letter demands that you remove all reference to Lady Bug on your website or face immediate legal action.
On December 13, 2012, we were advised of a posting made by Ms. Lisa Alfaro regarding Lady Bug’s business on your website, Unhappyfranchisee.com. The postings are patently false and defamatory, including, without limitation, those that imply her business model is illegal and that her employees are not covered by insurance. Many of the defamatory comments are made from the poster, Lisa Alfaro. However, the editorial comments made by Unhappyfranchisee.com are equally false and defamatory, and give rise to liability on the part of Unhappyfranchisee.com.
In addition to the obvious reasons that such postings have already damaged a franchisor like Lady Bug, by deterring potential franchisees, Arizona law provides for presumptive
damages when defamation involves one business. If the posting regarding Lady Bug is not removed from your site by close of business, January 4, 2013, we will pursue legal action against
Unhappyfranchisee.com and Lisa Alfaro to recoup these presumptive damages, in addition to all other damages sustained as a result of the defamatory postings. We will also seek an award of attorney’s fees and costs incurred in bringing this matter, as well as punitive damages.
We appreciate your cooperation. Please direct any correspondence to the undersigned.
Very truly yours,
GORDON & REES LLP
Sean M. Carroll
We believe that you can tell a lot about a company by how they respond to criticism.
In our experience, companies that have nothing to hide are comfortable in engaging in open dialogue, addressing complaints, acknowledging their shortcomings when warranted, and disproving unfair allegations, when necessary.
We are suspicious of companies that hide behind big law firms and try to suppress free speech through fear and heavy-handed (and expensive) threats… and suggest that prospective franchisees be suspicious, too.
In our opinion, Lady Bug Pest Control is deploying heavy artillery to kill a gnat.
It makes us wonder why…
It makes us wonder: What is Lady Bug Pest Control so afraid of?
Why so defensive?
See UnhappyFranchisee.Com’s response to Lady Bug’s threat here: LADY BUG PEST CONTROL Attacks UnhappyFranchisee.Com, Fails
ARE YOU FAMILIAR WITH THE LADY BUG PEST CONTROL FRANCHISE OPPORTUNITY? SHARE A COMMENT BELOW.
tags: Lady Bug Pest Control, Lady Bug Pest Control franchise, Lady Bug Pest Control complaints, Lady Bug Pest Control franchise complaints, pest control franchise, Lisa Miller, Gordon Rees, Sean Carroll, Attorney Sean M. Carroll, franchise complaints